Losses by central banks are nothing to fear

IF MONEY-LOSING banks are a source of concern, then surely losses by central banks—the bankers for banks—must be especially disconcerting. The tumbling value of assets held by the Bank of Japan and the Swiss National Bank seems a sure sign that central bankers have behaved recklessly and put their economies at risk. Anxiety about bond-buying in Germany, where on May 5th the constitutional court suggested that it might block the Bundesbank from participating in the European Central Bank’s asset-purchase programmes (see article), partly reflects such concerns. Central banks are not like private banks, though. Rather than reflecting financial weakness, their losses are a reminder of their odd institutional position.